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Travellers turn to travel agent-booked trips for protection as wars and wildfires threaten to ruin summer vacations

Demand for package holidays has staged an unexpected comeback as the spectre of wars, wildfires and worker strikes prompts holidaymakers to seek out greater protection.

Barclays spending data shows that spending at UK travel agents, which has been growing consistently since 2021, outpaced overall travel spend in 13 of the past 17 months.

In May, booking volumes through travel agents were up by 11 per cent year on year compared with 3.5 per cent growth in flight bookings, according to Barclays.

Travel agents including Tui, Jet2 and On the Beach are enjoying a renaissance as holidaymakers look to protect themselves against the risk their trip falls victim to flight delays and cancellations, which are increasing in regularity due to strikes, wildfires and wars.

Britons’ spending on package holidays is growing faster than overall travel spending in a buoyant post-pandemic market. In total, the UK, Irish and German package holiday market is expected to grow 8 per cent annually from £49bn in 2024 to £67bn in 2028, according to consultancy OC&C.

“Demand for package holidays is greater than it’s ever been,” said Shaun Morton, chief executive of UK-listed On the Beach, adding that consumers are “more aware now that if you’ve got [your holiday] as a package, you have more rights”.

Package holidays, which first gained popularity in the 1960s, were Brits’ default way of booking vacations until the internet enabled holidaymakers to research and book their own trips. The changes led to the collapse of Thomas Cook, the UK’s oldest travel agent, in 2019.

“Ten to fifteen years ago it seemed that [package holiday providers] were going to disappear,” said one adviser to leisure companies. “But that hasn’t happened. It has been really, really surprising”.

Demand for package holidays is growing as conflicts in the Middle East disrupt flights and air traffic control strikes in France caused widespread delays in July.

Meanwhile, the rising prevalence of wildfires is increasing risks for holidaymakers in southern Europe especially. Heatwaves have resulted in areas of Greece and Turkey being evacuated this summer.

“There’s always something happening, like events in the Middle East or there’s an earthquake in Turkey or there is a fire in Rhodes,” said Donat Rétif, chief executive of loveholidays. “[But] at the flick of a switch, we can send you somewhere else if you want to.”

Package holidays are covered under the EU Package Travel Directive (PTD) regulations, which protect consumers should their travel provider become insolvent and allow them to cancel their trip in certain circumstances.

The legislation, which has been transposed into UK law, does not cover holidays where consumers book flights and hotels separately. In addition, countries have their own regulations that ensure customers are repatriated if a tour operator collapses, such as ATOL in the UK and DRSF in Germany.

Jet2 chief executive Steve Heapy said when extreme events ruined a trip overseas those who booked a package holiday with a single provider were better placed to cope.

“Just imagine trying to get three different refunds from three credit cards at three different call centres,” he said.

Young adults were once at the forefront of the shift towards “DIY holiday booking” but they are now booking package holidays in greater numbers.

To attract more of them providers are offering interest-free repayment plans and a more diverse range of destinations — including the Azores and the Spanish seaside town of Tarifa.

Meanwhile, Jet2 has won fresh brand awareness among younger travellers thanks to viral internet content, showing holiday chaos accompanied with a narration of the company’s slogan, “Nothing beats a Jet2 holiday”. The song that has long accompanied Jet2’s adverts, Hold my Hand by Jess Glynne, has become so popular this year it has even been featured as a warm-up act at music festivals.

“Our branding has become something of a viral phenomenon this summer and we are pleased to see how many people have used it in good humour,” said a Jet2 spokesperson.

More mature package holiday providers — such as Tui — still own and operate hotels and aeroplanes, affording them less flexibility to cater for emerging or more unorthodox holiday destinations.

But newer market entrants have asset-light models, allowing consumers to create customised holidays via any available flights and properties, while enjoying the same protections as a traditional package holiday. On the Beach chief executive Morton said the most popular destination searched on its platform was “anywhere”.

Another online-only player, loveholidays, handled 5mn passenger bookings in its latest financial year, four times as many as in 2019.

Andrew Lobbenberg, an analyst at Barclays, said he believed the newer breed of package holiday providers — what he calls “tour operating 2.0” — would continue to thrive. “The whole concept has been modernised very successfully.”

Traditional providers are following their rivals. In March, Tui outlined plans to sell more seats on other airlines’ aircraft to expand its “dynamic packaging deals”. A person familiar with the company said it was selling “more packaged holidays than ever”.

Rich Robinson, head of hospitality and leisure at Barclays, said ultimately it was the fear of a ruined holiday, rather than greater choice, that was the real driver of the packaged holiday resurgence.

“People have had a lot of cancelled holidays. If you have had that experience then that’s in your mind and you want protection.”

Investors pile billions into New York office market

Rebound in CMBS borrowing tied to city’s skyscrapers signals thaw after pandemic chill

Investors are piling back into New York office buildings, lending billions of dollars to property developers in a sign big money managers see the return-to-office wave as a much-needed salve to the market.

Owners of four New York skyscrapers have tapped the commercial mortgage-backed securities market to refinance their debts in recent weeks, raising $3bn, according to documents reviewed by the Financial Times and data from Bank of America.

That has lifted borrowing tied exclusively to NY offices in the CMBS market to $11bn this year, with office financings in US securitised markets at their highest level since 2021, before the Federal Reserve began raising interest rates.

Importantly for property developers and the city, which depends heavily on the corporate sector for tax income, investors are opening their purse strings to buildings not considered trophy assets, including older towers. They see it as a sign debt markets are finally thawing for highly leased skyscrapers, particularly in crowded business districts along Sixth and Park Avenues, in Times Square and by Pennsylvania Station.

“Office is back,” said Mario Rivera, head of asset-backed securities at Fortress, a trend he put down to corporate policies demanding a return to in-person work. Pointing to a rebound on Sixth Avenue, a corridor filled with law firms, hedge funds and other financial institutions, he said “the market was shunning that space for a while but that’s no longer the case”.

Developers have clinched more than 20 CMBS financings backed solely by office properties in the US this year, up from eight for the whole of last year and none in 2023, according to BofA strategist Alan Todd. The CMBS market is just one place developers borrow to finance their properties.

Real estate developer Paramount raised $900mn in late July to refinance the debts of 1301 Sixth Avenue, home to French bank Crédit Agricole and law firm Norton Rose.

A few blocks north, Blackstone secured $850mn in debt in May, including more than $600mn through the CMBS market, as it invested alongside developer Fisher Brothers in 1345 Sixth Avenue. The tower is the future home of law firm Paul Weiss, which will pay about $81mn a year for the space, according to documents circulated to investors.

Apple’s New York City home opposite Penn Station was also refinanced by owner Vornado, raising $450mn. And the Durst Organisation clinched a $1.3bn financing backing the old Condé Nast and Skadden headquarters in Times Square, which it has since leased to companies including social media company TikTok and law firm Venable.

The deals point to a stabilisation in New York’s office debt market and a broadening of investor willingness to underwrite loans to developers. Last year and at the start of 2025, real estate businesses raised billions of dollars against a handful of marquee buildings, including a $3.5bn debt package for Rockefeller Center and a $2.9bn mortgage on The Spiral, a new building in Hudson Yards that houses HSBC.

The amount of office space available to lease has been shrinking as big companies expand in the city, according to real estate adviser CBRE. Midtown Manhattan availability rates dropped to 15.5 per cent in the second quarter from 18.2 per cent a year earlier.

Meanwhile, weekday use of the city’s subway system is rebounding, with average paid rides nearing 4mn a day, 72 per cent of pre-pandemic levels, according to New York’s Metropolitan Transportation Authority.

“Investors are seeing declining vacancy rates and net positive leasing trends . . . and saying maybe we’ve identified the floor in some of these markets,” said Matt Salem, head of real estate credit at KKR.

Salem added insurers had been big buyers of office debt this year, with investors seeking a slice of many of the NYC financings. KKR has purchased some $400mn of office-backed CMBS this year, he noted.

Investors nonetheless caution the recent dealmaking does not signal an all-clear in the office market and note the New York financings are all for buildings where a high proportion of space is already leased to blue-chip tenants, with properties that have not been renovated or are struggling to attract tenants still facing problems.

The deals also have lower leverage ratios than would have been typical before the pandemic, in a sign that lenders are requiring added protection to finance the transactions. In some cases, developers have invested extra equity in the property deals to make the debt balances more tolerable for creditors to underwrite.

“It is a tale of haves and have nots,” said Ben Hunsaker, head of structured credit at Beach Point Capital. “People are looking at availability in Park Avenue offices or Central Park view offices and are saying we can lend on this again . . . If you go out two blocks over it gets pretty ugly. I don’t know how much marginal demand comes for that.”

Market slump and new tax-free regime have made UK capital a more attractive destination, experts say

A depressed prime property market and a new tax-free regime have made buying in London more attractive to wealthy United Arab Emirates residents over the past year, according to their advisers.

Property agents and tax lawyers told the Financial Times that purchasers included UAE nationals and long-term UK expats, with some looking to relocate and others wanting a foothold in London at decade-low prices.

“The uptick in interest from the Middle East has been quite marked in the last three or four months,” said James Forbes, co-founder of Forbes Gilbert-Green, a London property advisory firm. “There’s an obvious increase in activity. London is looking cheaper than it was.”

Prime property in the UK capital has been in a slump over the past decade in part because of higher housing levies, uncertainty over Brexit and non-dom tax changes. House prices in Kensington and Chelsea fell to their lowest since 2013 in May 2025.

In her first Budget last October, chancellor Rachel Reeves abolished non-dom status and initiated a tax regime under which rich foreign arrivals or those returning to the UK after a decade overseas do not pay tax on their foreign income and gains (FIG) for four years.

A tax lawyer who specialises in the Middle East said: “I’ve got one British expat client who’s been in Dubai for a long time and he is now moving back to the UK and taking advantage of the new four-year FIG regime.”

Reeves was told by the Office for Budget Responsibility, the independent fiscal watchdog, to expect 25 per cent of non-doms with trusts to quit the UK in response to the crackdown on their tax status, which began under the previous Conservative government.

Stuart Bailey, head of prime central London sales at estate agent Knight Frank, said: “If you are from the UAE, for example, and of a generation that has not yet bought in London, both the suppressed pricing and the four-year FIG regime present a good time to buy.”

“Non-doms being pushed out of London certainly doesn’t benefit the wider economy, or the government with reduced stamp duty being collected, but it works well for opportunistic buyers, with less competition all the better,” he added.

Property values in Dubai have soared in recent years, with average prices per square foot up 67 per cent since July 2019, according to data analytics group Reidin. Luxury properties have gained particularly quickly, giving some homeowners in the UAE’s biggest city a chance to cash in.

UAE nationals accounted for 3 per cent of overseas buyers in prime central London in the year to July, up from 0.6 per cent the previous year, according to Knight Frank, which declined to provide absolute numbers. 

There are about 1mn Emirati nationals, according to official figures, and prime London sales comprise a small part of the overall residential property market.

Liza-Jane Kelly, head of London residential at estate agent Savills, said she had found homes for two returning British expats in the past three months. Both of them wanted UK education for their children, and one cited tax reasons.

“One said they’ve been in Dubai for 15 years, and it’s changed, and it’s got a lot busier,” Kelly said. The returnees bought in Chelsea and Knightsbridge, respectively, spending between £4mn and £6.5mn, she said.

Becky Fatemi, executive partner at Sotheby’s UK International, said recent changes standardising

UAE school holidays made spending family time in the UK easier, with some families looking to split the year between the UAE and Europe.

Despite July and August typically being quiet months, Fatemi said her company had experienced its busiest summer in three years, with buyers taking advantage of the dip in values to snap up sites that historically would not have come to market.

Interest in UK property goes beyond homes: Middle East family offices and wealthy individuals have invested £245mn in UK commercial real estate so far this year, compared with just £25mn for all of 2024, according to Knight Frank.

Reeves has been told by Treasury officials that fears of a mass non-dom exodus have been overstated and that there are encouraging signs that some wealthy people are deciding to move from Dubai to London. But there is no guarantee new arrivals will settle for the long term.

The Treasury said: “The UK remains a highly attractive place to live and invest. Our main capital gains tax rate is lower than any other G7 European country and our new residence-based regime is simpler and more attractive than the previous one.”

Official enquiries about grid connections suggest need for speedy energy access will support fossil fuel use

Developers looking to set up big data centres in Britain are exploring linking them up to the country’s main gas pipelines, as a boom in the industry triggers a rush for energy access.

Five large data centre projects in the south of England have made formal enquiries to National Gas about connections, the private owner of Britain’s gas transmission pipelines told the Financial Times.

Potential customers had indicated they were interested in building gas-fired power stations on site to provide steady power in the face of long lead times to connect directly to Britain’s electricity grid, the company added. 

“The national gas transmission network is ready to play a key role in facilitating this critical investment today while working in partnership with the electricity networks,” said Ian Radley, chief commercial officer at National Gas, which is owned by Australian asset manager Macquarie. 

The enquiries mark the first sign of data centres’ interest in connections big enough to need the transmission network, following media reports of interest in connections to the regional distribution network.

While National Gas declined to disclose details about the five projects, it said they would require roughly 2.5 gigawatts of capacity combined — equivalent to electrical capacity that could potentially supply several million homes.

The enquiries suggest that the need for speedy energy access will support fossil fuel use despite tech groups’ professed enthusiasm for cutting carbon dioxide emissions.

Data centres have always needed lots of electricity to run their processes and air conditioning to cool down. But they are becoming even more energy intensive because of artificial intelligence. The Nvidia-made chips that power most facilities consume far more electricity than traditional cloud computing systems for web hosting or business applications. 

The UK government is trying to expand the UK’s AI computing capacity and encourage data centres to be built in the country, as part of what it has billed as a “decade of national renewal”.

Ministers have selected the Teesworks former steel site in north-east England as the location for their second so-called AI Growth Zone, people briefed on the matter told the FT last month.

But delays in securing connections to Britain’s electricity grid — as well as high electricity prices — have for several years posed a big problem to electricity users and generators. Nvidia chief Jensen Huang this year warned Prime Minister Sir Keir Starmer that the UK was lagging global rivals in AI infrastructure development, despite its talent and potential. 

The International Energy Agency, an intergovernmental body, estimates that data centre power demand could more than double to 945 terawatt-hours by 2045 — slightly more than Japan’s entire electricity use today.

Data centres in the US are increasingly turning to gas-fired power stations despite pressure to cut carbon dioxide emissions, as they race to meet growing demand. 

Siemens Energy, the German energy equipment manufacturer, credited soaring demand for gas-fired turbines for data centres in the US as it posted a record order backlog of almost €136bn in August. 

More than 85 gas-fired power facilities are being developed around the world to meet data centres’ burgeoning energy demands from AI, according to research from Global Energy Monitor.

Gas connections are rarely used to power data centres full-time. But as many AI companies rush to build out computing capacity, there can often be a lag between securing valuable real estate, development permits and chips, and connecting a facility to the grid. 

Gas is seen by some in the industry as a way of bridging that gap, allowing data centres to come online quicker while providing backup generation. Once electricity connections are ready, the on-site gas-fired power station could switch to a backup role, National Gas said.

Elon Musk’s xAI used several gas turbines to power its “Colossus” data centre in Memphis, which houses more than 100,000 Nvidia chips, when it first came online last year. Some of the turbines have since been removed after the site’s grid connection was secured.

Teodora Kaneva, head of smart infrastructure and systems at trade group TechUK, said connections to electricity grids, as well as high electricity prices, were “one of the biggest challenges for investments in the UK”. 

“We had a recent case where we had a data centre which needed extra [capacity] — they were meant to receive that in September this year, but now they’re receiving it in 2037,” she said.

The enquiries registered with National Gas are not guaranteed to result in connection requests, with industry advisers noting that companies could simply be exploring their options.

“You make sure that if option 1, 2, 3 and 4 don’t work, you have another option further down the line,” said Luisa Mostarda, senior energy consultant at real estate group Savills.

In a crypto winter, the consequences could be painful for investors

When Charles Ponzi was arrested 105 years ago he had just raised as much as $20mn in seven months. Thousands of Americans had fallen for his scam investment scheme that promised to double their money in 90 days.

Depending on whether you are a signed-up crypto bro or not, bitcoin is either a brilliant innovation to move the world away from corruptible fiat currencies or a vast confidence trick. The advent of bitcoin treasury companies that raise debt and equity merely to buy bitcoin is, by extension, either genius financial engineering, or something akin to a Ponzi scheme upon a Ponzi scheme.

Such shorthand may be clumsy — crypto does not explicitly rely on new investors to remunerate existing ones as Ponzi did; and fraud, though sometimes connected with crypto, is not inherent to it. But there are still alarming similarities, most obviously the mood of cultish exuberance. Over the past year, bitcoin is up more than 80 per cent, four times the gain of the trendily tech-heavy Nasdaq index; who knows — it might manage 100 per cent in 90 days at some point.

Now consider a more recent parallel. Collateralised debt obligations — the mortgage derivatives that boomed in the years up to 2008 — were, again like crypto, a hyped asset class with little fundamental value (thanks to the ropey underlying loans that mortgage brokers were originating to meet feverish CDO demand).

As the fever peaked, CDOs were so hot that financial engineers dreamt up the CDO-squared — made from an amalgam of other sliced-and-diced CDOs, which in turn had sliced and diced the original ropey mortgages. Disaster, predictably, ensued. 

Bitcoin treasury companies are in a sense the CDO-squareds of the crypto universe. If you thought bitcoin mania was over the top, how much more so is the BTC — a company that either in part or entirely puts its cash into bitcoin or other crypto coins.

These are groups that were previously struggling tech designers, marketing companies or education consultancies, have thrown in the day job and punted on bitcoin. There are now dozens of them.

According to brokerage firm Peel Hunt, there are now more than 160 BTCs globally. All have been inspired by the story of Michael Saylor, who did just this with his software company Strategy (formerly MicroStrategy), and has been rewarded with more than 20-fold growth in the company’s share price since 2020. Strategy’s market capitalisation is now well over $100bn, triple the value of State Street.

In the iconoclastic world of bitcoin and BTCs, the concept of safeguarding company funds by a corporate treasurer in low-risk instruments goes out of the window — and into bitcoin. And more than that, the company then raises fresh equity, or issues a stream of debt or convertible bonds to expand those crypto holdings. Peel Hunt describes this as a “flywheel”.

For investors, the main appeal seems to be that they can plug into the upward momentum of crypto valuations, with built-in leverage.

In addition, there are multiple layers of arbitrage. First, depending on your location, there may be a tax play. In some jurisdictions, such as Japan, a corporate structure like a BTC would attract a lower rate of capital gains tax than a direct investment in crypto. In others, BTCs could be sheltered from tax altogether via tax-free stocks-and-shares wrappers.

Regulatory arbitrage may also be a draw. Crypto ETFs, for example, have yet not been authorised in the UK for retail investors; a BTC skirts that restriction. And for institutional investors, a corporate structure may circumvent a mandate that blocks them from holding crypto or other alternative assets directly.

In a relentlessly rising market, dodging roadblocks such as this, and maximising returns through leveraged BTCs, may feel smart. The market’s exuberance has certainly been boosted by Donald Trump’s government, particularly via his recent executive order to pave the way for 401(k) pensions to buy crypto, and his “Genius Act”, which will boost digital assets more broadly. (The Trump family’s own media company has itself pursued a $2bn bitcoin treasury strategy.)

As long as the bull run continues, BTCs — not very different from a Ponzi scheme upon a Ponzi scheme or a CDO-squared — may prosper. But “crypto winters”, as the “bros” discovered in 2018 and 2022, tend to be harsh; come the next one, BTC investors are likely to find the misery is squared, too.